A blog post entitled “Spending Your Life” is probably a bit extreme. But what choice is more extreme than how you choose to allocate your time?
Despite the fact we did not acquire a company this month, June 2019 has been a doozy. Maybe the tidal wave of ramifications caught up with me? Perhaps I am acclimating to all the new team members? Maybe they are adjusting to me? Regardless, time management and effective delegation has been heavy on my mind. So heavy in fact, I have not allocated time to write but one blog post this month.
As we turn our attention to the back half of the year, I am more cognizant of just how precious my time is. I am not alone in this regard. Everyone has limited time. As we developed processes to allocate limited cash, we also ought to have principles to guide our time allocation.
Below are a few allocation principles worth applying to time:
Principle 1: Gather a tremendous volume of alternatives. When making investments, consider any and all things available for sale. When allocating time, consider any and all activities.
Principle 2: Estimate the value of your alternatives. For buying businesses, we perform an intrinsic valuation using a weighted average cost of capital and a ton of assumptions. Rather than valuing time directly, I prefer to value the outcome of my actions performed through time. Thus, the result of my actions must be estimated through a slew of assumptions and measured by the cost of my time. Again, rather than valuing my time by the hour, I value my time based on the alternative actions foregone, and thus the results not achieved. Furthermore, I believe my choices can only degrade value. Thus, my time is of infinite value. Time allocation is really about activity allocation. So, how do you value actions and outcomes?
Principle 3: Sort alternatives in a logical manner for accomplishing a given objective. We sort investments based on margin of safety in order to obtain maximum return with least risk. With time, perhaps we might prioritize the actions with the biggest impact per hour for the same objective?
The above principles are a place to start. Too many people take conventional actions and expect exceptional results. This is a recipe for disappointment. Instead, I propose forming a decision process that increases the odds to obtain your objective.
As a young entrepreneur I remember vividly hiring my first full time employee. At that moment, I realized I could employ someone to do tasks that freed me up to perform other tasks. As I matured as a business owner, I began to hire people that could perform tasks that I could never perform. Ultimately, I came to believe that the ideal owner would employ every action of the business. Any labor requirement of the owner was constituted as a failure of the system. I called this process “work yourself out of a job.” Mikel and I have practiced this for years.
Within Little Engine Ventures, I now have the ultimate vehicle to fulfill this vision of passive, majority ownership. However, in the month of June 2019 a few Daryl sized holes appeared. I stepped in.
As we close out the month and I take some time away from a Saturday and a sinus cold recovery to write a blog post, I am humbled and grateful for the patience and passion from our rapidly expanding team. This month I have witnessed farmers “send it” through muddy fields, brewery staff step up production volume, and customer service representatives solve an unbelievable number problems large and small. New staff and old are coming together, prioritizing their time and actions in ways that will benefit us all.